59 



they decided to drop it. And please do keep in mind that they are 

 the number one seed producer and income holder of seed. 



Senator Kerrey. Mr. Robinson. 



Mr. Robinson. I may just mention that the representation of 

 ASTA is a broad base of some larger companies, some medium- 

 sized regional companies, and some smaller companies, a number 

 of whom, the regionals and smaller companies, doing quite a bit of 

 research, product development research. They are at risk just as 

 Pioneer is at risk in this situation. It is not just large corporations, 

 it is local and regional corporations as well. 



Senator Kerrey. Sir, did you want to respond? 



Mr. Newlin. Yes, I would like to respond to Ms. Winterboer's 

 comment. 



Senator Kerrey. Would you identify yourself? 



Mr. Newlin. My name is Owen Newlin. I am the retired senior 

 vice president of Pioneer Hybrid. I am a member of the board of 

 directors. We were not making any money on Hard Red Winter 

 wheat before we discontinued it. I don't know what that testimony 

 is. We broke even on one year in the previous years but we lost 

 money in all the years prior to that. We were selling by survey 91 

 percent of the wheat in Kansas with Variety 2157, but in fact, we 

 were only selling nine-tenths of 1 percent because the rest of it was 

 going brown bag, and that is essentially the reason we got out, be- 

 cause we could not get a return on our research investment. 



Ms. Winterboer. I apologize if that was taken wrong, but it was 

 in print from Michael Roth that they were making that percent. I 

 would also like to note that it is not necessarily the brown-bagging 

 that stopped Pioneer from selling seed, it is the fact that farmers 

 can save their own seed and replant it, which is the traditional and 

 the majority of the way farmers run their business. So in effect, 

 this would not have helped Pioneer at all, even if there wasn't any 

 brown-bagging. 



Mr. Newlin. It was the brown-bagging plus the selling to other 

 people from their own holdings. 



Ms. Winterboer. Correct, but it is hard to distinguish one from 

 the other. For another example, once we stopped doing any brown- 

 bag sales, the amount that we cleaned for farmers increased three 

 times. 



Senator Kerrey. Yes? 



Dr. Clayton. Mr. Chairman, we have a shared interest in invest- 

 ment, in the proper research and development that adds value to 

 basic germplasm that is out there. Whether it is something that we 

 have in our own possession or some exotic germplasm that might 

 be available from another country, the issue is stimulating invest- 

 ment to add value to that germplasm. 



The issue is what actions might we take which would stimulate 

 that investment. Certainly there are two ways to go, and they are 

 not mutually exclusive in the sense that there can certainly be pri- 

 vate sector investment. There also can be public sector investment. 



I guess the point I have particularly been struggling with is in 

 terms of the saved seed exemption and trying to determine in my 

 own mind what effect that has on investment, adding value to 

 basic germplasm so that we get new and improved varieties of 

 seeds. It does seem a bit difficult to sort out how, in fact, the saved 



